When Should a Manager's Course of Action Be to Do

question 129

Multiple Choice

When should a manager's course of action be to do nothing?

• A)when the cause of the variation has been identified
• B)when the standard is acceptable
• C)when the standard is not acceptable
• D)when the variance is acceptable

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Definitions:

Average Inventory

Average inventory is a calculation that estimates the value or quantity of inventory a company holds over a specific period, helpful for assessing inventory management efficiency.

Carrying Cost

Carrying cost refers to the total cost of holding inventory, which includes warehousing, handling, depreciation, opportunity costs, and insurance.

Carrying Costs

Costs that rise with increases in the level of investment in current assets.

Average Inventory

The mean value of inventory over a certain time period, used for inventory management and planning.